The impact of the Romanian higher education reform on the  university’s financial and academic management

Background:

In Romania: Higher education is one of the fastest growing sectors in Romania. The number of university graduates more than doubled by increasing from 33366 in 1992/1993 to 80991 in 1996/1997 (Romanian Statistical Yearbook, 1998). Such an increase is due to the high demand for higher education (prior to 1989 higher education was severely restricted), as higher education is associated with a higher status in society. At the same time the demand in the labor market increased for certain types of graduates, such as economists and jurists.

The quantitative increase in the supply of higher education is not sufficient to respond to the needs of a society in transition. In the Romanian society in transition towards a market economy, economic and political changes take place, at the same time with social and cultural changes (by redefining values and mentalities of people). Education in general and higher education in particular play a major role in the societal transformation process.

From the first months, after 1990, when communism was overthrown in Romania, the higher educational reform was launched. First measures were corrective: discontinuation of political indoctrination and of political and institutional police control. Subsequent measures included changes in curricula, textbooks and educational standards (the so-called modernization measures), as well as changes in the legal framework (Birzea, 1997). Sometimes practical changes were more advanced than the legal ones, as it is the case of private higher education institutions that were set up starting 1990, while reglementing legislation, was enacted later on in 1993 (the Law for Accreditation of Higher Education Institutions and Diplomas) and 1995 (the Education Law). In spite of these measures, few really changes took place in higher education: higher education remained centralized and limited changes took place in governance of education up to 1998. At the end of 1997, the reform in education (including higher education) was re-launched due to the appointment of a new Education Minister, Mr. Andrei Marga. The 1995 Education Law  was modified and reprinted in 1999, other decrees were enacted, new structural bodies (committees and councils) were organized at ministerial level in order to implement the reform.

Among the directions of the re-launched reform in higher education there are:

1.      the financial reform and

2.      the decentralization of decision making with respect to academic issues and current operations of state universities.

1.      The equilitarian distribution of public resources has been replaced with a new mechanism based on competition, namely global financing (Korka, 2000). The principle of global financing introduced in 1999 stands for dividing the state budget of education in two categories that can be obtained by institutions through different processes:

a)      the basic financing that is distributed to the universities according to the costs implied, calculated based on the number of equivalent students. Students are also funded based on merit, but the amount of merit is highly debatable (OECD, 2000).

b)      the complementary financing that is designated generally for research and is distributed based on competition. Project proposals from groups of academics, departments, faculties and universities can enter the competition for complementary financing.

The state financing was used so far for public universities. The law stipulates that accredited private universities can also benefit of the state’s financial support, but there was no case so far.

Besides the global financing that comes from the state, the new regulations allow state universities to use extra budgetary sources such as: donations, sponsorships, tuition fees, consultancy fees. These are newly allowed private sources of financing higher education that show that there will be a shift towards a more market driven way of managing education. In this way the Romanian higher education might join the present trends in Europe, where the expansion of the tertiary sector takes place through more private initiative and collaboration with the industry (UK, Holland) making higher education institutions more “entrepreneurial” (Claudius Gellert, 1997).

Private universities had financial autonomy from the very beginning as they use their own funds.

2.      The decentralization of decision making in higher education involves a number of aspects:

- the decentralization of academic decision making for decisions such as academic programs, admission exams, hiring and firing personnel, more flexibility regarding the curriculum.

-         the decentralization of financial decisions that imply a better financial management at university level.

Universities received the freedom to take initiatives and be entrepreneurial, as well as the obligation of accountability.

There are a number of national standards to which both public and private universities have to comply: curriculum, qualifications and promotion of teaching staff.

Research question and objectives of the study:

Given the situation in Romania our research question is how much do management of state universities benefit of the institutional autonomy that they were given? How much do the financial autonomy they receive by law, contribute to the diversification of sources of funding for universities? How is the academic autonomy implemented at university level? How accountable are universities given the autonomy they received?

Therefore the study proposes the following objectives:

1)      To evaluate the implementation of academic autonomy by assessing its contribution to changes in academic curriculum and academic programs at university level.

2)      To assess how financial autonomy at university level determined the better use of existing resources and the finding of new sources of financing.

3)      To study the mechanism of decision-making regarding academic issues and  financial issues within universities. Is the past model of transmitting decision top-down (from senates to faculties and individuals) preserved or there is more delegation of decision-making at faculties level and at individual level?

4)      To assess the university accountability towards state for using its funds and towards students for the programs delivered, programs that have to correspond with the demand from the labor market.

All the issues are of interest in both public (that were recently given autonomy) and the private universities (that benefited of larger autonomy-especially regarding financial issues- from the very beginning of their existence)

Research procedure

In order to reach these objectives, the research will be organized in two phases:

Phase 1: In Romania two detailed case studies will be developed for two universities, one state university and one private university. The two universities will be chosen from the economic field in order to ensure comparability. Personal interviews and focus groups will be organized at four levels within the two universities: rectorates, faculties’ management and individual academics and administrative departments. Information about employees and decision-makers at all levels within the university, about the way the financial and academic autonomy granted by law is perceived and is implemented will be collected during interviews.

Phase 2: In Romania a country-wide mail survey will be conducted with rectors, economic directors and deans of the 106 public and private universities in Romania (Statistical Yearbook, 1998).

Information about the new and old sources of finance and new and old educational programs; about the decision making related to these issues will be gathered in order to assess the implementation of financial and academic autonomy at university level.

Relevance of the study:

In Romania the study will bring contributions both at institution level, as well as at the ministerial policy level:

1)      At institutional (university) level the study will contribute with new improved procedures for pursuing autonomy in financial and academic activities .

2)      At ministerial level the study can suggest new  policies regarding the academic and financial autonomy, in case the present policy is considered inadequate by practitioners (academic world) or only improvements of existing policies.

3)      Again at ministerial level the study can suggest structural frameworks and new measures to support the implementation of the Ministry of Education policy of decentralization of decision making.

Bibliography:

Birzea, C. (1997) The Dilemmas of the reform of Romanian Education: Shock Therapy, the Infusion of Innovation or Cultural Decommunization? Higher Education in Europe. Vol. XXII, no. 3.

Gellert, C. (1997) Higher Education in Western Europe in Green M. (ed.) Transforming Higher Education Views from Leaders Around the World,

Korka, M. (2000) Strategy and Action in the Education Reform in Romania, Paideia Publishing House, Bucharest

National Commission of Statistics, (1998) Statistical Yearbook of Romania

OECD, (2000) Reviews of National Policies for Education: Romania